C4C1C2C3C5Part 42Statutory Auditors
Pt. 42 modified (6.4.2008) by The Statutory Auditors and Third Country Auditors Regulations 2007 (S.I. 2007/3494), reg. 43
Pt. 42: functions transferred in part (6.4.2008 in accordance with art. 1 of the amending S.I.) by The Statutory Auditors (Delegation of Functions etc) Order 2008 (S.I. 2008/496), art. 4 (which amending S.I. was revoked (2.7.2012) by S.I. 2012/1741, art. 6)
Pt. 42 applied (with modifications) (15.8.2008) by The Insurance Accounts Directive (Lloyd's Syndicate and Aggregate Accounts) Regulations 2008 (S.I. 2008/1950), reg. 6(5)
Pt. 42: functions transferred in part (2.7.2012) by The Statutory Auditors (Amendment of Companies Act 2006 and Delegation of Functions etc) Order 2012 (S.I. 2012/1741), arts. 1(2), 7, 8, 9 (with art. 16)
Chapter 6Supplementary and general
Power to require second company audit
C61248Secretary of State's power to require second audit of a company
1
This section applies where a person appointed as statutory auditor of a company was not an appropriate person for any part of the period during which the audit was conducted.
2
The Secretary of State may direct the company concerned to retain an appropriate person—
a
to conduct a second audit of the relevant accounts, or
b
to review the first audit and to report (giving his reasons) whether a second audit is needed.
3
For the purposes of subsections (1) and (2) a person is “appropriate” if he—
a
is eligible for appointment as a statutory auditor or, if the person is an Auditor General, for appointment as statutory auditor of the company, and
b
is not prohibited by section 1214(1) (independence requirement) from acting as statutory auditor of the company.
4
The Secretary of State must send a copy of a direction under subsection (2) to the registrar of companies.
5
The company is guilty of an offence if—
a
it fails to comply with a direction under subsection (2) within the period of 21 days beginning with the date on which it is given, or
b
it has been convicted of a previous offence under this subsection and the failure to comply with the direction which led to the conviction continues after the conviction.
6
The company must—
a
send a copy of a report under subsection (2)(b) to the registrar of companies, and
b
if the report states that a second audit is needed, take such steps as are necessary for the carrying out of that audit.
7
The company is guilty of an offence if—
a
it fails to send a copy of a report under subsection (2)(b) to the registrar within the period of 21 days beginning with the date on which it receives it,
b
in a case within subsection (6)(b), it fails to take the steps mentioned immediately it receives the report, or
c
it has been convicted of a previous offence under this subsection and the failure to send a copy of the report, or take the steps, which led to the conviction continues after the conviction.
8
A company guilty of an offence under this section is liable on summary conviction—
a
in a case within subsection (5)(a) or (7)(a) or (b), to a fine not exceeding level 5 on the standard scale, and
9
In this section “registrar of companies” has the meaning given by section 1060.
Pt. 42 applied (with modifications) (4.4.2014 for specified purposes, 16.12.2014 in so far as not already in force) by Local Audit and Accountability Act 2014 (c. 2), s. 49(1), Sch. 5 paras. 1-27 (with Sch. 13 para. 11); S.I. 2014/900, art. 2(j); S.I. 2014/3319, art. 2(e) (as amended: (31.12.2020) by S.I. 2019/177, regs. 2, 57; 2020 c. 1, Sch. 5 para. 1(1) and S.I. 2019/504, regs. 1(2), 3-6; 2020 c. 1, Sch. 5 para. 1(1); and (1.7.2022) by 2022 c. 31, s. 186(6), Sch. 4 para. 216, Sch. 7 para. 28; S.I. 2022/734, reg. 2(a), Sch. (with regs. 13, 29, 30); and (1.1.2024) by The Retained EU Law (Revocation and Reform) Act 2023 (Consequential Amendment) Regulations 2023 (S.I. 2023/1424), reg. 1(2), Sch. para. 82)